Inventory futures are flat after the large comeback on Wall Road, income proceed
US stock futures were flat in early morning trading on Wednesday after the big averages made up for much of their losses from Monday’s sell-off.
Dow futures were around 16 points higher. S&P 500 futures and Nasdaq 100 futures traded slightly higher.
Netflix reported a disappointing third-quarter subscriber forecast after the bell on Tuesday, but the stock gained 0.6% in extended trading. The streaming giant expects 3.5 million net subscribers in the third quarter, nearly 2 million below analyst estimates. The company also reported a result that fell short of expectations.
Meanwhile, Chipotle’s shares rose 4.3% in after-hours trading as the Mexican fast food chain reported quarterly sales that surpassed pre-pandemic levels as diners returned to their restaurants.
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On Tuesday, stocks rebounded sharply from Monday’s sell-off triggered by a Covid-inspired global growth fear. After its 8 month value day on Monday, the Dow Jones Industrial Average rebounded nearly 550 points, or 1.6%. It was the Dow’s biggest jump in more than a month.
The S&P 500 was up 1.5%. The Nasdaq Composite was up 1.6%.
The Russell 2000 small-cap benchmark was up 3% when the reopening games busted. American Airlines was up 8.4% and Norwegian Cruise Line was up 8.3%.
Bond yields also rebounded, with 10-year US Treasuries stabilizing 1.2% after falling to its lowest level in 5 months on Monday.
“Until the 10-year return rises above 1.3% again and stays above this level for a few days, today’s stock market rally is likely to be hesitant,” said Jim Paulsen, chief investment strategist of the Leuthold Group.
Some strategists see the market heading for a volatile phase in which there could be a deeper pullback. Investors juggle inflation concerns and new Covid cases rebound in the US as the Delta variant spreads.
“I think what we’ve seen here are the early warning shots of a correction we’re likely to see … in late August, September, October,” said Matt Maley, equity strategist at Miller Tabak.
The winning season continues on Wednesday with important reports from Coca-Cola, Johnson & Johnson, Verizon, CSX, Las Vegas Sands and Texas Instruments. About 85% of the S&P 500 companies that have reported to date have beat estimates, according to FactSet.
– with reports from CNBC’s Patti Domm.